You could claim back all of the VAT and be exempt from company car tax

 

Business Contract Hire is fast becoming the most popular form of business leasing here in the UK.

A company, or sole trader, has the use of a brand new car of their choice for a period of time, with no road tax to pay for the duration of the lease contract and a full manufacturer warranty is included.

Fixed monthly payments are paid for the period of the lease and at the end of the contract the car is returned and a completely new lease contract may be taken out if required.

You could claim back all of the VAT and be exempt from company car tax

What are the business benefits to leasing?

 

Who is eligible for a business lease?

You can get a business lease contract if:

  • You are a sole trader
  • You have a Ltd. company
  • You are a VAT registered business
  • You have a partnership with less than 4 partners

So what are the benefits of business leasing?

If you or your company is VAT registered and you lease a car, you can claim 50% VAT back on your monthly payments. If you use the car entirely for business use only (not used for travelling to and from work), then you could claim 100% back.

However, you can claim the monthly lease costs against profits but the percentage can vary. If the car you lease emits more than 160g/km you can only claim back 85% but if the car emits anything lower you are allowed to claim 100% back.

What about company car tax – do I have to pay it?

You might have to pay company car tax if you use the car for personal use such as driving to and from work.

If however the car is left at your workplace overnight and only used for business purposes, you will not have to pay company car tax.

Also, you don’t have to pay company car tax if:

  • You’re a sole trader
  • You are a member of a Limited liability partnership
  • You’re a partner or in a partnership

Leasing rather than buying also means you don’t have to deal with selling the car when the time comes and having to worry about depreciation.

 

Please click here to find out more about our car leasing services and special offers for both business and personal use, or give us a call on 0844 846 4007.


0 thoughts on “What are the business benefits to leasing?”

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Posts

Information

How Old Do I Have To Be To Lease A Car?

Leasing a car is a simple, hassle-free process at Clear Car Leasing not matter your age   Leasing a car rather than buying outright has become increasingly popular here in the UK, especially with new Read more...

Information

Electric Car Jargon: Explained

With diminishing supplies of resources, hybrid and electric cars or ‘greener’ cars will be a part of our future ahead. So with the impending presence of these vehicles it’s always best to get in the Read more...

Information

The benefits of leasing a car rather than buying one outright

For many, leasing a car can work out much cheaper than having to buy one outright   We now live in a society where paying for the things we want on a monthly basis has Read more...